Last week, JPMorgan (JPM  ) hinted that investors can use Bitcoin (BTC) and cryptos as a way to diversify their portfolios. The financial giant's analysts wrote in a note Wednesday: "In a multi-asset portfolio, investors can likely add up to 1% of their allocation to cryptocurrencies in order to achieve any efficiency gain in the overall risk-adjusted returns of the portfolio."

JPMorgan conceded that digital coins have limits to their usefulness as well, explaining: "Cryptocurrencies are investment vehicles and not funding currencies. So when looking to hedge a macro event with a currency, we recommend a hedge through funding currencies like the yen or U.S. dollar instead." With the suggestion, Wall Street seems to be warming to the idea of a tiny exposure to crypto since it is largely uncorrelated with stocks, bonds, and other traditional asset classes and can thus help hedge against volatility in equities.

Here is the rest of the week in review:

Coinbase criticized rival major exchange Binance in a filing with the U.S. Securities and Exchange Commission. The U.S. exchange slated to go public this year said that compliance with a changing regulatory landscape is a crucial risk to its business. Coinbase noted that compliance is particularly burdensome because it must compete with unregulated companies in other jurisdictions that escape enforcement, naming Asia-based Binance specifically. Coinbase wrote: "We also compete with a number of companies that solely focus on the crypto market and have varying degrees of regulatory adherence, such as Binance." Coinbase argued that offshore companies sell crypto exchange services and products to consumers located in the US and Europe while ignoring licensing requirements "seemingly without penalty." Namely, Coinbase cited anti-money laundering rules being imposed on crypto exchanges by the Financial Action Task Force, which it believes would create "substantial compliance costs" and could hurt the user experience.

The MIT Media Lab's Digital Currency Initiative is starting a multi-year effort dedicated to Bitcoin research and development, as the program raised $4 million from prominent investors including Twitter (TWTR  ) CEO Jack Dorsey, MicroStrategy (MSTR  ) CEO Michael Saylor, and Fidelity Digital Assets. MIT Media Lab aimed to raise $8 million, but it fell short of the goal. MIT Media Lab will spend resources on its Bitcoin Software and Security Effort, which aims to answer long-standing questions regarding Bitcoin's core attributes, including the stability of the network after the 21 million BTC mining subsidy ends. The Media Lab stated: "As the use of Bitcoin grows, and as it becomes more deeply embedded into our societies, the security of the network must grow and strengthen alongside it." The group has supported Bitcoin development since 2015.

Crypto prices fell to $1.326 trillion due to the large correction. For the majors, all except Cardano (ADA) and stablecoins declined, and Binance Coin (BNB) and Chainlink (LINK) posted outsized losses. In the top 100, the biggest losers were PancakeSwap (CAKE), down 50%, Huobi Token (HT), down 46%, and Horizen (ZEN), down 46%. The biggest gainers were Fantom (FTM), up 29%, UNUS SED LEO (LEO), up 26%, and Polygon (MATIC), up 19%. Next week traders will watch if crypto can bounce back from the correction.

The author owns a small amount of BTC.